Lloyds Bank has reportedly signed a ten-year deal with IBM to outsource data services to the IBM cloud. As part of the outsourcing, 1500 Lloyds employees and contractors will be moved over to IBM in September of this year.

The full transfer of duties from Lloyds to IBM is expected to take approximately three years.

The Register obtained an internal memo that confirmed that the agreement, “one of the largest cloud transformation deals” in the finance sector, had been finalized. Announcements are expected to be made to staff today.

The memo said that Lloyds will retain a substantial IT group within the company, but that the teams currently at work on Linux, Unix, Windows X86 and iSeries projects will be moved over to become IBM staff and contractors.

“Most colleagues working in Infrastructure Technology Services supporting these systems and delivering change will transition to IBM, with a number retained in Lloyds Banking Group to manage the relationship, service and governance of IBM.”

Outsourcing discussions began in late 2016, possibly due to the fact that Lloyds had experienced a number of technical issues in the months prior or as part of an overall restructuring of the organization which led to 12,000 layoffs and over 200 branch closings from 2015-2017.

Details were uncovered in March of this year, when it was estimated that Lloyds would move 2,000 members of staff to IBM. Under the agreement, IBM would purchase data center assets from Lloyds, and chargeback costs of operations and management.

As a result of the deal, Lloyds hopes to streamline its business, improve the agility of services, and save up to £760 million in the first seven years.

Lloyds CIO Morteza Mahjour said that outsourcing will make the bank more scalable, increasing flexibility and providing updated technology services to customers.

“As customer demands change and innovation in the industry gathers pace, having a more modern and agile technology platform will help us lay the foundations for the next phase of our strategy.”

That strategy has been developed in light of the recent re-privatization of Lloyds, who in May returned the government’s stake in the business when it repaid a £20 billion bailout loan with interest.

Chief executive Antonio Horta-Osorio said that the company would begin a strategic review of operations in July of this year, and release findings next January.